EXHIBIT 3.1
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AMENDMENT TO THE
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
KAANAPALI LAND, LLC
THIS AMENDMENT TO THE AMENDED AND RESTATED LIMITED LIABILITY COMPANY
AGREEMENT (the "Agreement") of KAANAPALI LAND, LLC (the "Company") dated as
of April 15, 2008, is entered into by PACIFIC TRAIL HOLDINGS, LLC its
manager (the "Manager").
WHEREAS, Section 3.1(b) of the Agreement grants the Manager the power
and authority to cause the Company to issue additional equity in the
Company, including, but not limited to the power and authority to designate
additional classes of membership interest; and
WHEREAS, pursuant to the authority granted to the Manager pursuant to
Sections 3.1(b) and 9.1(b)(iii) of the Agreement, the Manager desires to
amend the Agreement to establish a new class of membership interests in the
Company to be designated as the Class C Common Shares, and to set forth the
rights and terms of such Class C Common Shares as set forth in the ANNEX
attached hereto.
NOW, THEREFORE, in consideration of good and valuable consideration,
the receipt and sufficiency of which hereby are acknowledged, the Manager
hereby amends the agreement as follows:
1. AMENDMENT. Effective as of the date hereof, the Agreement is
amended to incorporate the ANNEX attached hereto as EXHIBIT C to the
Agreement.
2. CONTINUING EFFECTIVENESS. As herein amended, the Agreement
shall remain in full force and effect and is hereby ratified and confirmed
in all respects.
3. GOVERNING LAW. This Amendment shall be governed by the
internal laws of the State of Delaware.
4. DEFINED TERMS. Except as otherwise specified herein,
capitalized terms used and not defined herein shall have the respective
meanings assigned such terms in the Agreement.
IN WITNESS WHEREOF, the undersigned, the Manager of the Company has
executed this Amendment to the Agreement as of the date first above
written.
PACIFIC TRAIL HOLDINGS, LLC,
a Delaware limited liability company
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: President
Being the sole Manager of
Kaanapali Land, LLC, a Delaware
limited liability company
EXHIBIT C
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RIGHTS AND TERMS OF CLASS C COMMON SHARES
Under the authority granted to it by Section 3.1 of the Amended and
Restated Limited Liability Company Agreement of Kaanapali Land, LLC, a
Delaware limited liability company (the "Company"), dated as of
November 14, 2002 (the "LLC Agreement"), Pacific Trail Holdings, LLC, as
the Manager of the Company, hereby establishes an additional class of
membership interests entitled "Class C Common Shares." The Class C Common
Shares shall have the following preferences, conversion and other rights,
voting powers, restrictions, limitations as to distributions,
qualifications, and terms and conditions of redemption thereof:
Section 1. ISSUANCE AND DESIGNATION. This class of membership
interests shall be designated as Class C Common Shares (the "Class C
Shares"). The Manager hereby authorizes 52,000 Class C Shares for
issuance. Capitalized terms used but not expressly defined herein are used
as defined in the LLC Agreement.
Section 2. DEFINITIONS. For purposes of the Class C Shares, the
following terms shall have the meanings indicated:
"Common Shares" shall mean the membership interests of the Company as
set forth in the LLC Agreement and referred to therein as the Class A
Shares and Class B Shares, which became one class of regular Common Shares
as of November 14, 2007. Common Shares as used in this EXHIBIT C shall not
include the Class C Shares.
"Issue Date" as to the Class C Shares shall mean the date on which
the Class C Shares were first issued.
"Preference Amount" shall mean, with respect to each Common Share,
$19.00 per Share, less cumulative, aggregate distributions of Available
Cash by the Company to each such Common Share from and after the Issue
Date, subject to adjustment as provided in Section 6 hereof.
"set apart for payment" shall be deemed to include, without any
action other than the following, the recording by the Company in its
accounting ledgers of any accounting or bookkeeping entry which indicates
the allocation of funds to be so paid on any series or class of Shares of
the Company; PROVIDED, HOWEVER, that if any funds for any class or series
of Shares ranking on a parity with the Class C Shares as to the payment of
distributions are placed in a separate account of the Company or delivered
to a disbursing, paying or other similar agent, then "set apart for
payment" with respect to the Class C Shares shall mean placing such funds
in a separate account or delivering such funds to a disbursing, paying or
other similar agent.
Section 3. DISTRIBUTIONS.
(a) The holders of Class C Shares shall be entitled to
receive distributions of Available Cash on a per Share basis, in
accordance with Section 5.1 of the LLC Agreement, pro rate with
respect to each outstanding Common Share, on each Record
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Date set for such purpose by the Manager; PROVIDED, HOWEVER, the
Class C Shares shall be entitled to share in any distributions of
Available Cash only from and after such time as cumulative, aggregate
distributions by the Company with respect to each outstanding Common
Share have reduced the Preference Amount to zero.
(b) Subject to the distribution terms set forth in Section
3(a) above, so long as any Class C Shares are outstanding, no
distributions shall be paid or set apart for payment on any class or
series of Parity Shares (as defined in Section 8 hereof) for any
period unless full cumulative distributions have been or
contemporaneously are paid or a sum sufficient for the payment
thereof set apart for such payment on the Class C Shares for all
distribution periods terminating on or prior to the distribution
payment date on such class or series of Parity Shares.
Section 4. LIQUIDATION.
In the event of any liquidation, dissolution or winding up of the
Company, whether voluntary or involuntary, the holders of the Class C
Shares shall be entitled to receive liquidating distributions (if any) from
the Company in the same amounts and the same manner as distributions of
Available Cash as set forth in Section 3 hereof.
Section 5. REDEMPTION.
The Class C Shares shall not be redeemable at the option of either
the Company or any holder of Class C Shares; provided, however, that the
Company may redeem some or all of the Class C Shares on such terms as may
be mutually agreed between the Company and any holder of Class C Shares.
Section 6. ADJUSTMENTS TO PREFERENCE AMOUNT.
(a) If the Company shall after the Issue Date (A) pay a
distribution or make a distribution in Common Shares, (B) subdivide
its outstanding Common Shares into a greater number of Shares, (C)
combine its outstanding Common Shares into a smaller number of Shares
or (D) issue any Shares by reclassification of its Common Shares, the
Preference Amount in effect at the opening of business on the day
following the date fixed for the determination of holders of Common
Shares entitled to receive such distribution or distribution or at
the opening of business on the business day next following the day on
which such subdivision, combination or reclassification becomes
effective, as the case may be, shall be adjusted by multiplying (x)
the Preference Amount in effect immediately prior to the close of
business on the date fixed for the happening of any of the events
described above by (y) a fraction, the numerator of which is the
number of Common Shares outstanding immediately prior to such event
and (z) the denominator of which is the number of Common Shares
outstanding giving effect to such event. An adjustment made pursuant
to this Section 6(a) shall become effective immediately after the
opening of business on the business day next following the record
date in the case of a distribution or distribution and shall become
effective immediately after the opening of business on the business
day next following the effective date in the case of a subdivision,
combination or reclassification. In addition to the foregoing
adjustment, in
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the event of any distribution, subdivision, combination or
reclassification of the Common Shares under this Section 6(a), the
Company shall effect an equivalent and simultaneous pro rata
distribution, subdivision, combination or reclassification of the
Class C Shares.
(b) If the Company shall distribute to all holders of its
Common Shares any Shares (other than Common Shares) or evidence of
its indebtedness or assets (excluding cash or other distributions in
accordance with the terms of the LLC Agreement) or rights, options or
warrants to subscribe for or purchase any of its securities (any of
the foregoing being hereinafter in this Section 6(b) collectively
called the "Securities" and individually a "Security"), then in each
such case the Preference Amount shall be adjusted so that it shall
equal the price determined by multiplying (x) the Preference Amount
in effect immediately prior to the close of business on the date
fixed for the determination of holders of Common Shares entitled to
receive such distribution less (y) the then fair market value (as
determined by the Manager in its sole discretion, whose determination
shall be conclusive) of the portion of the Securities applicable to
one Common Share. Such adjustment shall become effective immediately
at the opening of business on the business day next following the
record date for the determination of holders of Common Shares
entitled to receive such distribution. If the fair market value (as
determined by the Manager in its sole discretion, whose determination
shall be conclusive) of the portion of the Securities applicable to
one Common Share exceeds the then remaining unpaid Preference Amount,
the holders of Class C Shares shall be entitled to participate in
distributions of such Securities in excess of such Preference Amount
on a pro rate basis per Share with the Common Shares as provided in
Section 3(a).
(c) No adjustment in the Preference Amount shall be required
unless such adjustment would require a cumulative increase or
decrease of at least 1% in such amount; PROVIDED, HOWEVER, that any
adjustments that by reason of this subparagraph (iii) are not
required to be made shall be carried forward and taken into account
in any subsequent adjustment until made; and PROVIDED, FURTHER, that
any adjustment shall be required and made in accordance with the
provisions of this Section 6 other than this Section 6(c) not later
than such time as may be required in order to preserve the tax-free
nature of a distribution to the holders of Common Shares. All
calculations under this Section 6 shall be made to the nearest cent
(with $.005 being rounded upward) or to the nearest one-tenth of a
Share (with .05 of a Share being rounded upward), as the case may be.
(d) If the Company shall be a party to any transaction
(including without limitation a merger, consolidation, statutory
share exchange, self tender offer for all or substantially all Common
Shares, sale of all or substantially all of the Company's assets or
recapitalization of the Common Shares and excluding any transaction
as to which Section 6(a) applies) (each of the foregoing being
referred to herein as a "Transaction"), in each case as a result of
which all or substantially all Common Shares are converted into the
right to receive shares, securities or other property (including
cash or any combination thereof), each Class C Share shall thereafter
be entitled to receive (x) the kind and amount of shares, securities
and other property (including cash or any combination thereof)
receivable upon the consummation of such Transaction with respect to
each Common Share reduced by (y) such shares, securities and other
property with a
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fair market value (as determined by the Manager in its sole
discretion, whose determination shall be conclusive) in an amount
equal to the then remaining unpaid Preference Amount. For purposes
of determining the kind and amount of shares, securities and other
property which each Class C Share shall be entitled to receive
pursuant to the preceding sentence, the holder of Common Shares shall
be assumed (i) not to be a Person with which the Company consolidated
or into which the Company merged or which merged into the Company or
to which such sale or transfer was made, as the case may be
("Constituent Person"), or an affiliate of a Constituent Person and
(ii) to have failed to exercise its rights of election, if any, as to
the kind or amount of shares, securities and other property
(including cash) receivable upon such Transaction (provided that if
the kind or amount of shares, securities and other property
(including cash) receivable upon such Transaction is not the same for
each Common Share held immediately prior to such Transaction by other
than a Constituent Person or an affiliate thereof and in respect of
which such rights of election shall not have been exercised ("Non-
Electing Share"), then for the purpose of this Section 6(d) the kind
and amount of shares, securities and other property (including cash)
receivable upon such Transaction by each Non-Electing Unit shall be
deemed to be the kind and amount so receivable per share by a
plurality of the Non-Electing Shares). The Company shall not be a
party to any Transaction unless the terms of such Transaction are
consistent with the provisions of this Section 6(d). The provisions
of this Section 6(d) shall similarly apply to successive
Transactions.
(e) Whenever the Preference Amount is adjusted as herein
provided, the Company shall promptly prepare a notice setting forth
the Preference Amount after such adjustment, setting forth a brief
statement of the facts requiring such adjustment and the effective
date of such adjustment which notice shall be conclusive evidence of
the correctness of such adjustment absent manifest error. The
Company shall mail such notice to the holder of each Class C Share at
such holder's last address as shown on the records of the Company.
(f) There shall be no adjustment of the Preference Amount in
case of the issuance of any Shares in a reorganization, acquisition
or other similar transaction except as specifically set forth in this
Section 6. If any action or transaction would require adjustment of
the Preference Amount pursuant to more than one paragraph of this
Section 6, only one adjustment shall be made and such adjustment
shall be the amount of adjustment that has the highest absolute
value.
(g) If the Company shall take any action affecting the Common
Shares, other than action described in this Section 6, that in the
opinion of the Manager would materially and adversely affect the
conversion rights of the holders of the Class C Shares, the
Preference Amount for the Class C Shares may (but need not) be
adjusted, to the extent permitted by law, in such manner, if any, and
at such time, as the Manager, in its sole discretion, may determine
to be equitable in the circumstances.
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Section 7. PREEMPTIVE RIGHT.
(a) If at any time after the Issuance Date the Company
desires to issue or sell for cash any additional Common Shares or
securities convertible, exercisable or exchangeable for the Company's
Common Shares (the "Additional Shares") to any Person (other than as
part of a public offering registered under the Securities Act of
1933, as amended), the Company shall give a written notice (the
"Issuance Notice") to the holders of Class C Shares setting forth the
proposed terms of the sale of such Additional Shares and the quantity
of Additional Shares to be issued, the proposed issuance date and the
price at which such Additional Shares shall be issued. Each of the
holders of Class C Shares shall have the option to purchase the
number of Additional Shares necessary to maintain such holder's
Ownership Percentage (as defined below) at the time of the Issuance
Notice, which option may be exercised by giving written notice to the
Company (the "Response Notice") within 14 days of the Issuance Notice
that contains an agreement to purchase all or any portion of the
Additional Shares to which such holder of Class C Shares is entitled
to purchase. Failure by a holder of Class C Shares to give the
Response Notice to the Company within such 14-day period shall be
deemed to be a rejection of such option. For a period of 180 days
after any Issuance Notice, the Company shall have the right to issue
or sell to any Person (a "Third Party Buyer") up to the number of
Additional Shares specified in the Issuance Notice less the number of
Additional Shares subscribed for pursuant to duly tendered Response
Notices at the same price and on other terms not materially less
favorable to the Company than as specified in the Issuance Notice.
At the time of the closing of the sale of the Additional Shares to
one or more Third Party Buyers, the Company shall sell to such holder
of Class C Shares and such holder of Class C Shares shall purchase
the Additional Shares that such holder of Class C Shares agreed to
purchase in the Response Notice, at the price and on the terms set
forth in the Issuance Notice. If at the end of the 180th day
following any Issuance Notice, the Company has not completed the
issuance described in the Issuance Notice, each holder of Class C
Shares that has provided a Response Notice shall be released from its
obligations thereunder. The rights and obligations of the parties
pursuant to this paragraph shall terminate upon the closing of an
initial public offering. For purposes herein, "Ownership Percentage"
shall mean the fraction (expressed as a percentage), the numerator of
which is the number of Class C Shares owned by such holder and the
denominator or which is the sum of the outstanding Common Shares and
outstanding Class C Shares.
(b) If the Company shall authorize the granting to the
holders of Common Shares any rights, options or warrants to subscribe
for or purchase any outstanding Shares of any class or any other
rights, options or warrants, then the Company shall cause to be
granted to each holder of Class C Shares a number of such rights,
options or warrants on a per Share basis equal to the Ownership
Percentage of such holder of Class C Shares.
(c) The provisions of this Section 7 shall not apply to any
issuance or award of additional Shares to employees or consultants of
the Company in an aggregate amount not to exceed three percent (3%)
of the issued and outstanding Common Shares.
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Section 8. RANKING. Any class or series of Shares of the Company
shall be deemed to rank:
(a) prior to the Class C Shares, as to the payment of
distributions and as to distribution of assets upon liquidation,
dissolution or winding up, if the holders of such class or series
shall be entitled to the receipt of distributions or of amounts
distributable upon liquidation, dissolution or winding up, as the
case may be, in preference or priority to the holders of Class C
Shares; and
(b) on a parity with the Class C Shares, as to the payment of
distributions and as to distribution of assets upon liquidation,
dissolution or winding up, whether or not the distribution rates,
distribution payment dates or redemption or liquidation prices per
Share thereof shall be different from those of the Class C Shares, if
the holders of such class or series and the Class C Shares, shall be
entitled to the receipt of distributions and of amounts distributable
upon liquidation, dissolution or winding up in proportion to their
respective amounts of accrued and unpaid distributions per Share or
liquidation preferences, without preference or priority one over the
other ("Parity Shares"). The Class C Shares shall rank on a parity
with the Common Shares, subject to the terms of Section 3 hereof.
Section 9. VOTING. Each Class C Share shall be entitled to vote,
together with the Common Shares as a single class, on each matter presented
for the vote or written consent of holders of Common Shares generally under
the LLC Agreement. So long as any Class C Shares are outstanding, in
addition to any other vote or consent of holders of Common Stock required
by the LLC Agreement, the affirmative vote of at least 66-2/3% of the votes
entitled to be cast by the holders of the Class C Shares at the time
outstanding, acting as a single class regardless of series, given in person
or by proxy, either in writing without a meeting or by vote at any meeting
called for the purpose, shall be necessary for effecting or validating any
amendment, alteration or repeal of any of the provisions of the LLC
Agreement or this Exhibit C that materially and adversely affects the
voting powers, rights or preferences of the holders of the Class C Shares;
provided, however, that the amendment of the provisions of the LLC
Agreement so as to authorize or create or to increase the authorized amount
of any Shares of any class, whether ranking senior to or on a parity with
the Class C Shares, shall not be deemed to materially adversely affect the
voting powers, rights or preferences of the holders of Class C Shares.
For purposes of the foregoing provisions of this Section 9, each
Class C Share shall have one (1) vote per Share. Except as set forth
herein, the Class C Shares shall not have any relative, participating,
optional or other special voting rights and powers other than as set forth
herein, and the consent of the holders thereof shall not be required for
the taking of any Company action.
Section 10. TRANSFER RESTRICTIONS. Notwithstanding Article 6 of the
LLC Agreement, the Company is authorized, in establishing any award or
grant or other issuance of these Class C Shares, to agree or otherwise
impose upon the holder of the Class C Shares, in connection with such award
or grant or other issuance, additional restrictions on the transfer, sale
or other disposition of any such Class C Shares.
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